Hyundai Livart Furniture Company Limited (KRX:079430) Looks Just Right With A 41% Price Jump

Hyundai Livart Furniture Company Limited (KRX:079430) shares have had a really impressive month, gaining 41% after a shaky period beforehand. Looking back a bit further, it's encouraging to see the stock is up 28% in the last year.

In spite of the firm bounce in price, it's still not a stretch to say that Hyundai Livart Furniture's price-to-sales (or "P/S") ratio of 0.1x right now seems quite "middle-of-the-road" compared to the Consumer Durables industry in Korea, where the median P/S ratio is around 0.6x. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/S.

See our latest analysis for Hyundai Livart Furniture

How Has Hyundai Livart Furniture Performed Recently?

Recent revenue growth for Hyundai Livart Furniture has been in line with the industry. It seems that many are expecting the mediocre revenue performance to persist, which has held the P/S ratio back. Those who are bullish on Hyundai Livart Furniture will be hoping that revenue performance can pick up, so that they can pick up the stock at a slightly lower valuation.

If you'd like to see what analysts are forecasting going forward, you should check out our free report on Hyundai Livart Furniture.

Do Revenue Forecasts Match The P/S Ratio?

In order to justify its P/S ratio, Hyundai Livart Furniture would need to produce growth that's similar to the industry.

If we review the last year of revenue growth, the company posted a worthy increase of 6.0%. Revenue has also lifted 15% in aggregate from three years ago, partly thanks to the last 12 months of growth. So we can start by confirming that the company has actually done a good job of growing revenue over that time.

Turning to the outlook, the next year should generate growth of 3.6% as estimated by the only analyst watching the company. That's shaping up to be similar to the 5.2% growth forecast for the broader industry.

In light of this, it's understandable that Hyundai Livart Furniture's P/S sits in line with the majority of other companies. Apparently shareholders are comfortable to simply hold on while the company is keeping a low profile.

What Does Hyundai Livart Furniture's P/S Mean For Investors?

Its shares have lifted substantially and now Hyundai Livart Furniture's P/S is back within range of the industry median. While the price-to-sales ratio shouldn't be the defining factor in whether you buy a stock or not, it's quite a capable barometer of revenue expectations.

A Hyundai Livart Furniture's P/S seems about right to us given the knowledge that analysts are forecasting a revenue outlook that is similar to the Consumer Durables industry. At this stage investors feel the potential for an improvement or deterioration in revenue isn't great enough to push P/S in a higher or lower direction. If all things remain constant, the possibility of a drastic share price movement remains fairly remote.

Many other vital risk factors can be found on the company's balance sheet. You can assess many of the main risks through our free balance sheet analysis for Hyundai Livart Furniture with six simple checks.

If you're unsure about the strength of Hyundai Livart Furniture's business, why not explore our interactive list of stocks with solid business fundamentals for some other companies you may have missed.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.